Petroleum, motor vehicles lift US import prices in October

The Labor Department said on Tuesday import prices increased 0.5 percent last month after an upwardly revised 0.2 percent gain in September. It was the second straight month of gains.Reuters | November 16, 2016, 13:27 IST

WASHINGTON: US import prices rose for a second straight month in October as the cost of petroleum and motor vehicles increased, but persistent dollar strength continued to keep underlying imported inflation subdued.

The Labor Department said on Tuesday import prices increased 0.5 percent last month after an upwardly revised 0.2 percent gain in September. It was the second straight month of gains.

In the 12 months through October, import prices fell 0.2 percent, the smallest decrease since July 2014, after declining 1.0 percent in September.

The strong dollar has resulted in the country importing deflation, helping to hold inflation persistently below the Federal Reserve's 2 percent target.

But with the dollar's rally gradually fading and oil prices continuing to stabilize, some of the deflationary pressures from overseas are easing, which should allow inflation to steadily rise toward its target.

The report also showed export prices rose 0.2 percent in October after gaining 0.3 percent in September. Export prices were down 1.1 percent from a year ago. That was the smallest decline since October 2014.